How are COSW butterfly max profit and max loss calculated?

Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit. For the COSW butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 20.90%), the computed maximum profit is $135.93 per contract and the computed maximum loss is -$52.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a COSW butterfly?

The breakeven for the COSW butterfly priced on this page is roughly $39.52 and $42.48 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current COSW market-implied 1-standard-deviation expected move is approximately 5.99%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current COSW implied volatility affect this butterfly?

COSW ATM IV is at 20.90% with IV rank near 25.06%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.

COSW Butterfly Strategy

COSW (Roundhill COST WeeklyPay ETF), in the Financial Services sector, (Asset Management industry), listed on CBOE.

The Roundhill COST WeeklyPay ETF (COSW) is designed to offer investors a blend of regular weekly income and moderately enhanced exposure to the weekly price movements of COST stock. It achieves this objective by investing in total return swap agreements and directly in COST common stock, collectively targeting approximately 120% of the underlying stock's calendar week return. This effectively provides 1.2x leveraged exposure to a single company's shares. Shareholders can expect weekly distribution payments. To secure its investments, the fund allocates capital to short-term US Treasurys and money market funds as collateral. Investors should be aware that COSW introduces heightened volatility compared to traditional ETFs.

COSW (Roundhill COST WeeklyPay ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $12.1M, a beta of 0.10 versus the broader market, a 52-week range of 40.31-50.32, average daily share volume of 5K, a public-listing history dating back to 2025. These structural characteristics shape how COSW etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.10 indicates COSW has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. COSW pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on COSW?

A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration.

Current COSW snapshot

As of June 29, 2026, spot at $40.67, ATM IV 20.90%, IV rank 25.06%, expected move 5.99%. The butterfly on COSW below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 18-day expiry.

Why this butterfly structure on COSW specifically: COSW IV at 20.90% is on the cheap side of its 1-year range, which favors premium-buying structures like a COSW butterfly, with a market-implied 1-standard-deviation move of approximately 5.99% (roughly $2.44 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated COSW expiries trade a higher absolute premium for lower per-day decay. Position sizing on COSW should anchor to the underlying notional of $40.67 per share and to the trader's directional view on COSW etf.

COSW butterfly setup

The COSW butterfly below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With COSW near $40.67, the first option leg uses a $39.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed COSW chain at a 18-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 COSW shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$39.00	$2.40
Sell 2	Call	$41.00	$1.22
Buy 1	Call	$43.00	$0.56

COSW butterfly risk and reward

Net Premium / Debit: -$52.00
Max Profit (per contract): $135.93
Max Loss (per contract): -$52.00
Breakeven(s): $39.52, $42.48
Risk / Reward Ratio: 2.614

Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit.

COSW butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on COSW. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$52.00
$9.00	-77.9%	-$52.00
$17.99	-55.8%	-$52.00
$26.98	-33.7%	-$52.00
$35.98	-11.5%	-$52.00
$44.97	+10.6%	-$52.00
$53.96	+32.7%	-$52.00
$62.95	+54.8%	-$52.00
$71.94	+76.9%	-$52.00
$80.93	+99.0%	-$52.00

When traders use butterfly on COSW

Butterflies on COSW are pinning bets - traders use them when they expect COSW to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.

COSW thesis for this butterfly

The market-implied 1-standard-deviation range for COSW extends from approximately $38.23 on the downside to $43.11 on the upside. A COSW long call butterfly is a pinning play: it pays maximum at the middle strike if COSW settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current COSW IV rank near 25.06% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on COSW at 20.90%. As a Financial Services name, COSW options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to COSW-specific events.

COSW butterfly positions are structurally neutral / pin (limited-risk, limited-reward); the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. COSW positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move COSW alongside the broader basket even when COSW-specific fundamentals are unchanged. Always rebuild the position from current COSW chain quotes before placing a trade.

Frequently asked questions

What is a butterfly on COSW?: A butterfly on COSW is the butterfly strategy applied to COSW (etf). The strategy is structurally neutral / pin (limited-risk, limited-reward): A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration. With COSW etf trading near $40.67, the strikes shown on this page are snapped to the nearest listed COSW chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are COSW butterfly max profit and max loss calculated?: Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit. For the COSW butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 20.90%), the computed maximum profit is $135.93 per contract and the computed maximum loss is -$52.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a COSW butterfly?: The breakeven for the COSW butterfly priced on this page is roughly $39.52 and $42.48 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current COSW market-implied 1-standard-deviation expected move is approximately 5.99%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on COSW?: Butterflies on COSW are pinning bets - traders use them when they expect COSW to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.
How does current COSW implied volatility affect this butterfly?: COSW ATM IV is at 20.90% with IV rank near 25.06%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.